Kimmunications

Guarantees and Generalizations

This week, I want to do things a little differently. Instead of writing my usual article, I sat down with newsletter editor (and radio show sidekick) James Pecht and discussed some feedback we received from our recent "Red Flag" articles. It's an audio file about 14 minutes long, and you can download it to listen from your computer or move it to your mp3 player.

Click here for the audio Kimmunique (Hi - 128k | Lo - 24k)

Notes:
0:00 Introduction
2:00 What we mean by the statement "If a financial advisor constructs a portfolio with an expected return of less than 10 percent, that's a red flag"
4:40 Why that statement did not reflect a guarantee but rather a goal
5:45 Generalizations in the articles -- why I use inflexible rules
8:25 About the information session scheduled for Saturday, May 31. (After my talk, we'll head over to Boston's the Gourmet Pizza on 635 and MacArthur in Irving to broadcast the weekly radio show live on location. Then we'll stick around to answer questions and talk to folks one-on-one.)
10:45 New virtual office hours -- a twice-weekly conference call.

Details on the office hours: 

• Wednesdays 5 p.m. - 6 p.m. Central Time
• Thursdays Noon-1 p.m. Central Time

Ask anything that's on your mind about the Snider Method, personal finance, the economy -- you name it! We have a special toll-free conference call line -- you can call in and ask your questions, or just listen in to what others are asking. The office hours have an online component, too -- the technology we're using allows me to show you calculations, visit websites, etc. It's like you're sitting right beside me, looking at my computer screen together.

To join me, here's what you do:

1. Call 1-888-617-3400 and enter the access code 791564.
2. (Optional) Go to https://www1.gotomeeting.com/join/597893666.Please note: Attendance is limited for the online component, and you may be prompted to download some software the first time you log on.

---

 

Kim Snider is the President and Founder of Snider Advisors, an SEC Registered Investment Advisor, focused on teaching individual investors a sensible, long-term investment approach focused on maximizing cash flow. For more information on Snider Advisors or the Snider Investment Method and how to stop enriching your investment advisors at your expense, please visit snideradvisors.com. Her book, How to Be the Family CFO: Four Simple Steps To Put Your Financial House in Order, will be in bookstores October 1, 2008.

Snider Advisors makes no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method® Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments, including the Snider Investment Method™ are subject to risk, including possible loss of principal.

Podcast for 11/13/07: Interview with Kim Kiyosaki

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Kim interviews Kim Kiyosaki about her book, Rich Woman, and the lessons of cash-flow investing.

MP3 Download: Hi (128k) | Lo (24k)

Length: 23:22

Notes:
0:45  Kim Kiyosaki tells us about her motivation for writing this book to women, and shares some financial statistics about women

2:55  58 percent of Women Baby Boomers have less than $10,000 saved for retirement.

4:20  Kim Kiyosaki introduces the idea of cash-flow investing

5:10  Why do American women not have a greater interest in investing?

7:07  A couple may be living well in retirement, then the husband dies and the wife doesn't know what to do

8:45  Do you think that there is an industry that preys on the uneducated elderly?

9:51 Who is buying this  book?

10:45 The unspoken rule of "He or she who controls the money, makes the rules."

12:05 Kim Kiyosaki gives us a taste of what we will learn in her book.

Resources:

Rich Woman: A Book on Investing for Women - Because I Hate Being Told What to Do!
Investing for Cash Flow

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 11/06/07: Interview with Brian Russell

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Kim interviews Brian Russell of Chronim Advisors about the importance of investing for the long term.

MP3 Download: Hi (128k) | Lo (24k)

Length: 12:32

Notes:
0:55  Brian describes a study that showed how investors balanced hypothetical portfolios based on 1 month, 1 year and 5 year returns.
3:05  Stocks do well over the long term, but investor performance has a lot to do with how investors perceive their returns.
3:50  The market takes large swings. If you're in there for the long run, you can be more comfortable with those swings.
6:00  The importance of developing a plan and sticking with it.
7:31  Basic concepts for the beginning investor
9:01  Look for lower fees when investing

Resources:
Investing for Cash Flow

Podcast for 10/30/07: Interview with Dr. Daniel Bergstresser

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Kim interviews Dr. Daniel Bergstresser of the Harvard Business School about the costs and benefits of brokers in the mutual fund industry.

MP3 Download: Hi (128k) | Lo (24k)

Length: 13:05

Notes:
1:00  Daniel Bergstresser gives an overview of the study.
2:19  He says they found that funds sold through the broker channel, even before you subtract the distribution fees, perform worse than funds sold through the direct channel. (This applied to domestic equity funds)
3:00  He says the findings surprised them.
3:50 The five questions Dr. Bergstresser and his colleagues attempted to answer.
4:26  Some of the hypotheses they tested on where brokers create value for their customers. In the aggregate, he says, it doesn't look like brokers are delivering tangible benefits.
6:36  They looked at whether brokers corrected bad behavior, such as chasing returns. They didn't.
8:40  Load structures (commissions) and their bearing on which funds investors choose.
10:39  If you're looking for the benefits created by brokers, you need to look along less tangible dimensions than the ones Dr. Bergstresser and his peers studied.

Resources:

Assessing the Costs and Benefits of Brokers in the Mutual Fund Industry

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 10/23/07: Highlights from KRLD live show

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Highlights from the October 20 show on KRLD in Dallas-Fort Worth.

MP3 Download: Hi (128k) | Lo (24k)

Length: 22:25

Notes:
0:40  Maria asks if she should take money out of her Roth IRA to pay off her debt.
3:55  Alan asks about absolute-return CDs
7:47  Peter asks about the Snider Method and taxes
9:28  Mary is recently retired and doesn't have access to a computer. What should she do to get things in order? Kim recommends going to a fee-only financial planner.
12:32  Jack has $500,000 that isn't invested anywhere, and he wants to retire in the next 10 years. He asks what he should do with his money.
15:59  Junior asks how the Snider Investment Method would perform after a terrorist attack or other major market-moving event.
18:48  Steve, via email, asks about his 401(k) at a former employer.

Resources:
National Association of Personal Financial Advisors

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 10/16/07: Interview with Pamela Perun

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Kim interviews Pamela Perun of the Aspen Institute about simplifying savings plans.

MP3 Download: Hi (128k) | Lo (24k)

Length: 18:50

Notes:
1:02  Pamela says that there are too many kinds of savings plans, leaving us with a complicated system of saving that individuals and employers have difficulty maneuvering through
1:36  The most common kinds of savings plans
2:50  Tax advantages are viewed as an incentive for people to contribute to these savings plans.
3:11  Pamela says that the tax advantages encourage those who pay higher taxes to save using these plans. She says there needs to be some kind of incentive to encourage those in lower tax brackets to save, too.
4:48  The differences between intermediary plans and open-access plans
5:55  Intermediary plans have been the most successful-- reasons may be psychological and practical
8:25  Pamela says IRAs have essentially been a failure -- people who don't have access to a 401(k) aren't likely to save in an IRA, either. Most IRAs are funded through rollovers from intermediary plans.
9:15  People do save, but not enough to fund a comfortable retirement -- and this is true across all income levels
9:40  Lots of people don't take advantage of their employer matches. Financial economists are researching which kind of match works best for which types of people.
10:38  Too many choices lead to "investment paralysis."
12:20  Savings plans are quite complicated, and they have numerous fees that not everyone is aware of.
14:25  Steps toward making the savings system better. Step one: Simplify. She suggests one plan for all types of savers, regardless of employer, etc.
15:20  We need fewer, but better, plans, she says.
16:22  Focus on outcomes. People don't save because they have no clue how much retirement is going to cost them, she says.

Resources:
The Aspen Institute, Initiative on Financial Security
"Toward a Sensible System of Saving"

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

Podcast for 10/9/07: Interview with Jesse Anderson

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Kim interviews Jesse Anderson, manager of trading at Chronim Advisors, about options as a source of income.

MP3 Download: Hi (128k) | Lo (24k)

Length: 10:12

Notes:
1:00  Many people don't understand options, which is why they're often apprehensive about using them in their portfolios.
1:48  Options give investors flexibility
2:17  A lot of people think options are inherently risky; they were actually created to reduce risk. Speculators create a lot of the misconceptions about options.
3:01  Two ways to hedge against risk using options
3:55  The Snider Method does NOT use options to speculate.
4:09  Using options as a source of portfolio income
6:38  Some of the things Snider Method investors look for to generate income off their portfolios
7:22  Snider Method investors have a Web-based program that helps them sift through all the stock/option combinations out there.
8:10  Where people can learn more about options.

Resources:
Options Industry Council
Chronim Advisors
KimSnider.com

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 10/2/07: Interview with Dr. Burton Malkiel

Kim talks with Dr. Burton Malkiel, author of A Random Walk Down Wall Street, about the latest edition of his book and investing based on sound judgment rather than emotion.

MP3 Download: Hi (128k) | Lo (24k)

Length: 16:26

Notes:
1:10  Interview with Dr. Burton Malkiel
4:01  Dr. Malkiel discusses how 'behavioral finance' affects our ability to make good financial judgments
9:30  The effects of the misleading press
11:05 What to do about your 401(k) and investing when the market is dropping
13:00 The principle of rebalancing your investments

Resource:
A Random Walk Down Wall Street
Make the Right Call for Financial Success

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 9/25/07: Highlights from KRLD live show

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Highlights from the live call-in show on KRLD-AM (1080) in Dallas-Fort Worth.

MP3 Download: Hi (128k) | Lo (24k)

Length: 14:05

Notes:
0:37  Terry asks about his 401(k) and whether he can roll it over from his current employer
6:14  Dale talks about his experience with the Snider Method
8:56  Ken sold a business and wanted to know what to do with the money
10:40  Ken (a different Ken) has $200,000 and wants to know if he should pay down his mortgage significantly or invest the money

Resources:
Make The Right Call for Financial Success
How to Turn Your 401(k) into a Million-Dollar Nest Egg

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 9/18/07: Interview with Paul B. Farrell

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Kim interviews Marketwatch.com columnist and author Paul B. Farrell about Wall Street's Machiavellian ways.

MP3 Download: Hi (128k) | Lo (24k)

Length: 13:12

Notes:
1:07  Paul Farrell explains why he was drawn to the book, The Politics of Life: 25 Rules For Survival in a Brutal and Manipulative World by Craig Crawford.
2:15  Wall Street is using the power of behavioral finance against investors.
2:35  Rule No. 1: Life is a filthy battle for control.
3:35  Rule No. 5: Ambition is never, never satisfied.
4:40  Rule No. 10: The more visible your power, the more its limits are known.
5:55  Rule No. 12: Most would rather follow a leader than lead a following.
7:21  Next Rule: Those who prefer to lead a following cannot be trusted.
7:54  Rule No. 17: Those who are dependent on you will be the most faithful.
9:55  Rule No. 25: The powerful never give up control; it must be taken away.

Resources:
Paul B. Farrell
The Lazy Person's Guide to Investing
The Politics of Life: 25 Rules For Survival in a Brutal and Manipulative World

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 9/11/07: Interview with Doug Hirschhorn

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Kim interviews Dr. Doug Hirschhorn, a.k.a. "The Trading Dr." They talk about the psychology of investors and the four most common emotional pitfalls traders face.

MP3 Download: Hi (128k) | Lo (24k)

Length: 23:40

Notes:
1:05  What is a trading coach, and what does that have to do with sports psychology?
2:42  Doug gives an overview of the four emotional pitfalls traders face.
    1. Fear of Missing Out
    2. Focusing on the money and not the trade
    3. Losing objectivity on a trade
    4. Taking on risk because you're up (or down) money.
3:40 If you're really here to make money, then don't make decisions that are counterproductive, like making trades because you're afraid to miss an opportunity.
4:42  Traders sometimes experience "trading injuries" that can cause them to undertrade or lose confidence. It's similar to when an athlete experiences a major injury.
6:40  In order to make money, you have to not focus on making money. You have to focus on making the right trade.
8:50 If you stick to your disciplines, you have good days/weeks/months of trading, even if the outcome isn't good. The more you stick with your good methods, you more success you'll have.
10:00  Manage your risk and the returns take care of themselves. But also make only high-quality trades where you have "edge."
11:33 Emotions can really mess things up. Something changes in our thought processes when we have real money on the line. Use a system you develop when you're sane, when there's no money on the line, and stick with it when you do have money in the game. That's the gist of staying objective when investing.
16:38  A mechanical investment strategy (following step by step) is good to take emotions out of the equation.
18:29 Doug explains pitfall #4 -- taking on risk because you're up or down money. Casinos prey on this. To be successful trading, you need to think like a casino thinks. Mental accounting sometimes messes us up.

Resources:
Dr. Doug Hirschhorn, The Trading Dr.
The Head Coach

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Subscribe:

Kim interviews Dr. Doug Hirschhorn, a.k.a. "The Trading Dr." They talk about the psychology of investors and the four most common emotional pitfalls traders face.

MP3 Download: Hi (128k) | Lo (24k)

Length: 23:40

Notes:
1:05  What is a trading coach, and what does that have to do with sports psychology?
2:42  Doug gives an overview of the four emotional pitfalls traders face.
    1. Fear of Missing Out
    2. Focusing on the money and not the trade
    3. Losing objectivity on a trade
    4. Taking on risk because you're up (or down) money.
3:40 If you're really here to make money, then don't make decisions that are counterproductive, like making trades because you're afraid to miss an opportunity.
4:42  Traders sometimes experience "trading injuries" that can cause them to undertrade or lose confidence. It's similar to when an athlete experiences a major injury.
6:40  In order to make money, you have to not focus on making money. You have to focus on making the right trade.
8:50 If you stick to your disciplines, you have good days/weeks/months of trading, even if the outcome isn't good. The more you stick with your good methods, you more success you'll have.
10:00  Manage your risk and the returns take care of themselves. But also make only high-quality trades where you have "edge."
11:33 Emotions can really mess things up. Something changes in our thought processes when we have real money on the line. Use a system you develop when you're sane, when there's no money on the line, and stick with it when you do have money in the game. That's the gist of staying objective when investing.
16:38  A mechanical investment strategy (following step by step) is good to take emotions out of the equation.
18:29 Doug explains pitfall #4 -- taking on risk because you're up or down money. Casinos prey on this. To be successful trading, you need to think like a casino thinks. Mental accounting sometimes messes us up.

Resources:
Dr. Doug Hirschhorn, The Trading Dr.
The Head Coach

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 9/4/07: Interview with Dr. Annamaria Lusardi

Kim interviews Dr. Annamaria Lusardi, economics professor at Dartmouth, about her recent paper on financial literacy and retirement preparedness.

MP3 Download: Hi (128k) | Lo (24k)

Length: 27:10

Notes:
0:19  Introduction of Dr. Annamaria Lusardi and paper "Financial Literacy and Retirement Preparedness."
0:54 Dr. Lusardi talks about the two previous papers she and her research partner, Olivia Mitchell, wrote on financial literacy.
1:59  The three questions they asked in their first survey: 1) If you had $100 in a savings account, and the interest rate was 2% per year, after 5 years how much would you have if you let the money grow? 2) If the interest rate is 1% and inflation is 2%, after 1 year would you be able to buy more or less than today? 3) Does buying a single company stock provide a safer return than a stock mutual fund? The large majority couldn't answer these simple questions correctly.
3:04  They were surprised how widespread this lack of knowledge was.
4:44 The questions in this latest paper: 1) If the chance of getting a disease is 10%, how many people out of 1,000 could be expected to get the disease? 2) If 5 people all had the winning lottery number, and the prize is $2 million, how much would each of them get? Most people got these wrong, too.
5:49  If they got the questions right, they were asked about compound interest: If you have $200 in an account, which earns 10% per year, how much would you have after 2 years?
6:59  How the answers break down by different groups
8:21  Connections between financial literacy and financial success
9:32 Not a chicken-and-egg problem; people who are more financially literate tend to be more financially successful.
10:42  What the results tell us about baby boomers in particular.
12:58  This lack of financial literacy isn't just an American problem. It's global.
14:43 What's being done to address this lack of literacy-- One is financial education in high school, but this doesn't address those who are out of high school. Employers and the Internet are viable alternatives, but how do you guarantee the quality of the education, and how do you avoid conflict of interest? Dr. Lusardi says government institutions and non-profit foundations are the best equipped to address this problem.
17:15  Dr. Lusardi details what Japan did after World War II to instill saving and frugality in its citizens.
18:37  Dr. Lusardi says it's not that financial education is ineffective; it's that the cure is inadequate for the disease.
20:34  More on conflict of interest
23:37 Basic takeaways: People don't have a lot of financial knowledge. It shouldn't be taken for granted, especially since more and more people are responsible for their own retirement.

Resources:
1. Lusardi, Annamaria and Mitchell, Olivia S., "Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education Programs" (January 2007). Available at SSRN: http://ssrn.com/abstract=957796

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 8/28/07: Highlights from KRLD show

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This week's podcast features calls from our weekly radio show on KRLD-AM (1080).

MP3 Download: Hi (128k) | Lo (24k)

Length: 14:18

Notes:
1:00 Mickey asks how he can tell whether some old stock he inherited is worth anything
4:00  Alan asks about covered options and LEAPs, and how the Snider Method differs from another company that has a show on the radio
12:40  Jeff asks what to do if you're just starting out.

Resources:
"Personal Investing 101"

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 8/14/07: Interview with Jordan E. Goodman

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Kim interviews author and speaker Jordan E. Goodman about investing topics everyone should know about.

MP3 Download: Hi (128k) | Lo (24k)

Length: 14:09

Notes:
0:57  Nobody cares about your money as much as you do. Getting educated empowers you to do the best you can with your money.
2:13  Crowds of investors always seem to do the opposite of what they should be doing.
3:23  When you buy a stock, you are actually buying equity in that company -- you are along for the ride. So Jordan says you should buy high-quality companies.
4:42  Jordan talks about dividends.
6:06  About bonds and how they work
7:03  Bonds and risk
7:39  The difference between managed mutual funds and index funds. Most managed funds don't beat the indexes over time.
8:42  Money-market funds
9:50  It pays to research who has the best money-market rates.
10:12  For people who don't have experience in investing, start small and use systems that are mostly automatic and keep you from making snap decisions.
10:50  Real estate
11:46  You owe it to yourself to learn as much as possible.

Resources:
Jordan Goodman's website
Kim Snider
Personal Investing 101: An introduction to cash-flow investing using the Snider Investment Method™

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

Podcast for 8/7/07: Highlights from live show

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Kim takes calls from listeners on KRLD-AM (1080) in Dallas-Fort Worth.

MP3 Download: Hi (128k) | Lo (24k)

Length: 11:10

Notes:
0:58  Paul asks if he can use the Snider Investment Method(tm) in an IRA
2:55  Amy asks about college financial aid and 529 plans... Kim says that's not her area of expertise, but that Amy should consult a fee-only financial planner.
5:48  Carroll asks if there's someone who can manage his money for him using the Snider Method
9:00  Steve asks if he can use the Snider Method in his 401(k).

Resources:
"Investing for Cash Flow"
KimSnider.com

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 7/31/07: Highlights from live radio show

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This podcast features calls from the live radio show on Saturday, July 29.

MP3 Download: Hi (128k) | Lo (24k)

Length: 13:35

Notes:
0:48  Brian asks Kim to describe the Snider Method in more detail
4:02  John filed Chapter 13 bankruptcy a couple of years ago, he has $17,000 in an annuity and is approaching 50. He's feeling nervous about retirement. Kim says he needs to save like crazy.
5:52  Bill is 36 and is a government employee. He describes his savings and his investments in his Thrift Savings Plan -- is he on pace to retire at 50?
11:00  Chuck asks about closed-end funds.

Resources:
Investing for Cash Flow

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 7/24/07: Interview with Ned Bennett

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Kim talks to Ned Bennett, CEO of optionsXpress Inc., about using options to generate income and minimize risk..

MP3 Download: Hi (128k) | Lo (24k)

Length: 15:40

Notes:
0:54  Ned Bennett explains a couple of strategies to use options to generate income.
3:21  Ned says options aren't necessarily risky; you can use them to mitigate risk. Leasing a car is a lot like using options.
7:08  Ned says options are a strategic investment.
8:12  How selling calls can effectively reduce your cost basis
8:53  He explains buying puts and creating collars
9:30  Mutual funds have more risk than most realize because you can only trade them after the market closes. ETF's and options can help you manage your risk better.
10:54  People need a base education on options before they get started. He explains where you can get information.
14:00  Use of options will be more significant the higher the market goes.

Resources:
Kim Snider Financial Communications
Options Industry Council
optionsXpress

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 7/17/07: Interview with John-Paul Pigeon

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Kim interviews 12-year-old entrepreneur, author and speaker John-Paul Pigeon about the importance of investing for cash flow.

MP3 Download: Hi (128k) | Lo (24k)

Length: 9:32

Notes:
1:12  John-Paul Pigeon tells us how he got started with finance and investing.
2:08  He talks about Robert Kiyosaki's influence
2:32  John-Paul describes the speeches he gives to schools and businesses
3:32  John-Paul says why he thinks cash flow is so important, particularly the power of an additional paycheck.
4:33  He talks about his business
5:20  The importance of cash flow for personal finances
5:57  John-Paul talks about his book, "John-Paul's Secret Recipe," which is about cash flow and his first business, a lemonade stand.

Resources:
John-Paul International
John-Paul's Secret Recipe
"Investing for Cash Flow"

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 7/10/07: Interview with Nassim Nicholas Taleb

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Kim interviews Nassim Nicholas Taleb, author of The Black Swan and Fooled by Randomness, about randomness in the stock market.

MP3 Download: Hi (128k) | Lo (24k)

Length: 10:05

Notes:
0:58  Nassim Nicholas Taleb says our brains don't remember facts; they weave stories. It helps us remember things better, and it implies causal explanation.
2:20  We have so many things to associate with each other today, our brains can't keep up. We make quick shortcuts that sometimes lead to bad correlations.
3:40  We tend to always attribute a cause to something, even though it may be a random event. We also tend to over-infer from a very short time series.
4:22  Most economic news is pretty much noise.
5:53  Taleb says to avoid the financial news at all costs.
7:15  Images, particularly on TV, distort the probabilistic thinking in your brain.

Resources:
Nassim Nicholas Taleb's home page
Fooled by Randomness
"The Black Swan: The Impact of the Highly Improbable"

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 7/3/07: Interview with Robert Kiyosaki

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Kim interviews Robert Kiyosaki about the importance of cash-flow investing.

MP3 Download: Hi (128k) | Lo (24k)

Length: 9:06

Notes:
0:56  Robert details the difference between capital gains/capital appreciation and income or cash-flow investing.
1:40  He says the reason people think investing is risky is because they're used to capital appreciation investing, which is much riskier than cash-flow investing.
2:11  The difference between a rancher and a dairy farmer
4:25  Cash flow is real; it's money in your pocket. Capital appreciation is just paper gain until you liquidate.
6:20  Kim asks if people understand the concept of cash flow if you put it in terms of a business.

Resources:
Rich Dad
"Investing for Cash Flow"

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 6/26/07: Highlights from KRLD live show

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Kim takes questions from callers on KRLD-AM (1080) in Dallas-Fort Worth.

MP3 Download: Hi (128k) | Lo (24k)

Length: 20:10

Notes:
1:08  Bruce is an indexer who is interested in the Snider Investment Method. He asks about taxes and their effect on returns. He also asks about a few index funds.
5:15  David had to exercise stock options when he left his previous employer, but now he has to pay about $100,000 for the AMT. He doesn't want to cash out his options because he wants long-term capital gains, not short ones, and he can't get those until October. He asks about protective puts to protect the value of his holdings. Kim says don't let the tax tail wag the investment dog.
8:36  Ted, who has to be brilliant because his last name is Snider, says he's new to investing and wants to know how to get started.
12:36  Rick works for a county and has a deferred compensation plan, other than a retirement plan. He wants to know if he should stop his deferred contributions and go with the Snider Method, or should he take it out and put it in another plan.
14:52  Ginger is a retired teacher who wants to know about municipal bonds as a safe investment.
17:30  Gary is self-employed and asks whether a 401(k) or a Roth IRA would be better. Kim suggests he take a look at SEP IRAs since there aren't the income limits of the Roth IRA, and the contribution limits are higher.

Resources:
KimSnider.com
"What Wall Street Won't Tell You"
How to Turn Your 401(k) Into a Million-Dollar Nest Egg

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 6/20/2007: Highlights from KRLD show

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Kim takes questions from callers on 1080-AM KRLD in Dallas-Fort Worth.

MP3 Download: Hi (128k) | Lo (24k)

Length: 17:53

Notes:
1:00  Tony says 9/11 scared him out of stocks and mutual funds. He says he's let a lot of potential earnings just slip away. He asks what he can do to ease his way back into the market.
4:04  David asks about Dimensional Funds... thumbs up or thumbs down?
6:45  Burton asks about Forex trading and where to learn the art of trading foreign currencies. Kim says she does not recommend Forex trading, and there's a big difference between trading and investing.
11:10  Pankaj wants to know his options when a company whose stock he owns goes bankrupt
15:05  Kim details what the Snider Investment Method does to protect against bankruptcy

Resources:
Kim Snider Financial Communications

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

Podcast for 6/12/07: Interview with Dr. Shlomo Benartzi

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Kim interviews Dr. Shlomo Benartzi, a professor of behavioral decision making at UCLA, about his research into the shortcuts our brains make when making difficult financial decisions.

MP3 Download: Hi (128k) | Lo (24k)

Length: 27:05

Notes:
1:56  Dr. Benartzi says there's more research about people *actually* behave in their behavior plans, as opposed to how they *should* behave.
3:47  Some of the assumptions many other studies make about investors, and how they differ from reality
4:55  Dr. Benartzi explains the concept of heuristics or logical shortcuts -- common rules of thumb people use when they invest
5:52  Dr. Benartzi says he uses rules of thumb, just like everybody else -- even economists use these shortcuts.
7:19  His research found that the number of lines on an investment enrollment form directly determined how many funds people select.
9:45  One finding: People tend to trust the peer member they view as having the most investment knowledge, and they copy him/her. An example: a grocery store chain where most employees simply copied the investment decisions of their store's butcher.
12:35  Dr. Benartzi says people like to follow the herd when they face difficult decisions.
13:45  When people face difficult decisions, they're likely to look for shortcuts -- sometimes that shortcut is avoiding the problem or procrastinating indefinitely
14:45  People can have too many choices in their retirement plans, and that glut of choice makes people more confused and demotivated.
16:08  Heuristics make individual investors terrible market timers.
18:43  One term he uses is "myopic loss aversion"
22:52  Proposed solution -- "Save more tomorrow," an escalator savings program
25:35  Simplicity is often overlooked in investing, and simplicity is a very good thing.

Resources:
Heuristics and Biases in Retirement Savings Behavior
Dr. Benartzi's page at UCLA

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.

 

Podcast for 6/5/07: Interview with Max Jaffe

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Kim  Snider talks with Max Jaffe about his software program, The Financial Fuel Gauge, and how it can help people manage their spending and saving.

MP3 Download: Hi (128k) | Lo (24k)

Length: 13:49

Notes:
1:58  Max says his company helps people keep more of the money that they make.
2:30  He says it's all about changing your behavior
3:05  Max says saving is the often-forgotten first step to investing.
3:50  Max walks us through how the Financial Fuel Gauge works.
5:45  The Financial Fuel Gauge takes your income, expenses, assets and liabilities and nets it all into one number so you can see where you stand.
8:40  The tool is online and is in beta testing. Get to it through spendingsolutions.com.
9:13  Max says his approach is different because the system tells you how to save your money.
9:53  You can't invest what you don't save, and you shouldn't invest until you're out of debt.
10:30  Max believes in paying down your mortgage so you'll have more to invest.
11:20  Max says the savings rate in America is negative, and his tool aims to reverse that.
12:34  Max says go to maxjaffe.com to learn more about him and his Financial Fuel Gauge.

Resources:
Max Jaffe
Spending Solutions Inc.

 

Kim Snider, Kim Snider Financial Communications, Chronim Investments and/or Snider Advisors make no representation that the information and opinions expressed are accurate, complete or current. The opinions expressed should not be construed as financial, legal, tax, or other advice and are provided for informational purposes only. Call 866-952-0100 to request the Snider Investment Method™ Owner's Manual, which includes a description of the Snider Investment Method, investment objectives, risks, suitability and other information. Please read and consider carefully before investing. All investments are subject to risk including possible loss of principal.